Volunteer Theft & Nonprofit Fraud Statistics (2026)

Nonprofit leaders face a persistent financial threat that rarely makes headlines: internal fraud and embezzlement. Internal fraud is a notable risk for nonprofits, with 10 percent of all occupational fraud cases occurring within these organizations, according to the 2024 ACFE Report. When volunteers or staff members steal, the damage extends far beyond lost dollars—it erodes trust, damages reputation, and diverts scarce resources from mission. This report examines the statistics, patterns, and prevention strategies that matter. It's part of our volunteer screening statistics hub.

Key takeaways

The scale of nonprofit fraud

The Association of Certified Fraud Examiners estimates that companies and nonprofits lose approximately 5% of their annual revenue to fraud, according to a 2024 report. For nonprofits, this translates to staggering real-world losses. Nonprofits lose an estimated 7% to 13% of annual income to theft, embezzlement, or fraud. That equals about $40 billion every year across the sector.

When a single fraud case is detected, the median damage is significant. With 10 percent of all occupational fraud cases occurring within nonprofits, the median loss is $76,000. Yet nonprofits in the study reported a median loss of $100,000—an 11 percent increase from the previous study and a significant loss to any charitable organization.

For religious, charitable, and social service organizations, the median loss rises to $85,000, emphasizing their particular vulnerability.

Who steals from nonprofits?

The profile of a nonprofit fraudster defies common stereotypes. The typical nonprofit fraud case was committed by a female with no criminal record. She earned less than $50,000 a year and had worked for the nonprofit for at least three years.

Most fraudsters are first-time offenders with clean employment histories; 87% had not previously been disciplined by an employer for fraud-related issues. Yet more than 25 percent of the reported nonprofit frauds were conducted by managers, while 9 percent of the perpetrators were executives. Organization managers committed fraud that resulted in the greatest median loss to the organization ($150,000).

Position matters. Trusted roles with financial oversight—treasurers, bookkeepers, executive directors—create the highest-risk opportunities. "Embezzlement — fraud committed by employees and volunteers — is especially painful in community nonprofits. Not only is real damage done to our organization, but we feel that our cause has been betrayed by someone we trusted and liked."

How fraud happens: the most common schemes

Nonprofit fraudsters don't need sophisticated methods. For nonprofits with fewer than 100 employees, the most common fraud schemes include corruption (44 percent), billing fraud (31 percent), and check or payment tampering (23 percent).

Cash remains the easiest target. Cash was by far the largest misappropriation at 34.5 percent of the total, probably because cash is easy to "misplace." Check tampering — writing unauthorized checks or altering payee information. Billing fraud — creating fictitious vendors and submitting invoices. Expense reimbursement fraud — inflating or fabricating business expenses. Payroll fraud — creating ghost employees or inflating hours. Skimming — taking cash donations before they're recorded.

Cash and check tampering top the list with a combined loss of more than $400,000 annually.

Detection: the silent killer of fraud

Most nonprofits don't catch fraud quickly. One-third of fraud goes undetected for over two years. This delay dramatically increases losses. The nonprofits that provided fraud awareness training uncovered frauds in an average of 9 months, compared to 24 months for those that did not provide training. This is a significant amount of time to remain vulnerable and continue to take on financial loss.

Whistleblower tips remain the most effective tool, accounting for 43 percent of all fraud detections. Yet Nonprofits have the lowest implementation rate of fraud awareness training — 52% for staffers and 49% for management (vs. 82% and 81%, respectively, for public companies). Organizations without fraud awareness training suffer two times the financial losses of organizations with it.

Volunteer screening adoption and gaps

Background screening of volunteers has become mainstream, yet gaps remain. More than 80-90% of organizations now screening at least some of their volunteers, background checks are becoming essential for creating safe and trustworthy environments.

However, comprehensive screening is far less common. A major 2018 survey found that 92% of volunteer-screening programs ran criminal record checks, but only 47.17% screened all volunteers before onboarding, and 18% did not screen volunteers at all at that time. Only 32 percent of volunteer organizations re-screen volunteers on a periodic basis after initial onboarding, creating gaps when a volunteer's circumstances change.

Fingerprinting and abuse-record checks remain underutilized. A 2018 Sterling Volunteers survey of 967 organizations found 92 percent conduct criminal record checks, but only 25 percent include fingerprinting, and just 27 percent check neglect and abuse records.

Prevention controls that work

The good news: The presence of 18 anti-fraud controls was associated with both faster detection and lower losses. Four controls show outsized impact: Surprise audits, financial statement audits, hotlines and proactive data analysis — were associated with at least a 50% reduction in both fraud loss and duration.

With strong management reviews in place, organizations reduce financial losses from fraud by a median 60%.

Practical controls include:

• Requiring multiple levels of approval for transfers and transactions and requiring that certain transactions be accompanied by back-up documentation. Organizations can require that checks over a certain amount be signed by two authorized individuals.
• Screen board members, staff, and key volunteers with background checks and references, revoke authorizations immediately on departure, and require MFA for digital access.
• Include fraud prevention and reporting instruction in your orientation of new staffers and executives, as well as volunteers with financial responsibilities. Also provide periodic refreshers for existing employees.
• Segregate financial duties so no single person can both authorize and complete a transaction.

For volunteer-heavy organizations, background checks are foundational. VolunteerBadge helps nonprofits implement affordable FCRA-compliant screening at scale—starting at $5 per check with identity verification included, no monthly fees.

Reputational and operational impact

Financial loss is only the beginning. The reputational damage that can occur is a potentially even greater cost of fraud to nonprofit organizations. Because most nonprofits depend on support from donors, grantors, or other public sources, their reputations are among their most valued assets.

Donors and grantmakers will be less likely to give such an organization future money if they hear about the fraud. And because embezzlement is so often kept quiet in nonprofits, many groups think they are the only ones to experience it.

Services to children and fragile populations are diminished or cut altogether. Quality of life programs for everyone in the community are affected.

What this means for your volunteer program

Nonprofit leaders and boards face a clear choice: invest in prevention or absorb both financial and reputational damage. Volunteer fraud happens—not because volunteers are uniquely dishonest, but because opportunity, motivation, and weak controls align.

Start here:

• Screen comprehensively and early: Don't wait. Conduct identity-verified background checks on all volunteers with financial or vulnerable-population access before they begin work. Periodic re-screening catches changed circumstances.
• Build role-based screening tiers: Not every volunteer needs a deep check—but those handling cash, managing accounts, or working with children do. Use bulk import tools to scale screening without manual overhead.
• Train and communicate: Fraud awareness training cuts losses by half and halves detection time. Make sure your character reference process includes conversations about organizational controls, not just glowing remarks.
• Separate duties: Two people for check approvals, monthly financial reviews, annual audits. No single volunteer should control both the donation and the deposit.
• Enable confidential reporting: A whistleblower hotline or anonymous form detects 43% of fraud. Volunteers who spot something wrong need a safe way to report it.

At VolunteerBadge, we make FCRA-compliant screening affordable. Our fixed $5 check with identity verification removes the cost barrier that keeps many nonprofits from screening. And our free fraud prevention training module helps you understand what to look for when you're reviewing a check result.

Download the data

Access every statistic in this report as a spreadsheet:

Frequently asked questions

Q: What counts as volunteer fraud vs. employee fraud?
A: Employees or volunteers may divert funds intended for the nonprofit's mission for their own personal use. Embezzlement can undermine an organization's ability to provide services and harm its reputation. Legally, the distinction is whether the person is compensated; operationally, both pose the same risk. That's why comprehensive background screening should cover all roles with financial or access responsibilities, volunteer or paid.

Q: Are volunteers less likely to commit fraud than employees?
A: The data doesn't show a significant difference by employment status. Nonprofit embezzlement can involve anyone: officers, directors, employees, volunteers, contractors, vendors, etc. What matters is access, lack of oversight, and opportunity—not whether someone is paid.

Q: How do I write an adverse action notice if a background check comes back with a concern?
A: Under the Fair Credit Reporting Act (FCRA), if you intend to disqualify a volunteer based on a third-party background check, you must provide a pre-adverse notice, allow them to dispute, and then send a final adverse action notice. FCRA compliance is non-negotiable—mistakes can expose your nonprofit to federal lawsuits. VolunteerBadge guides you through the required notices at each step.

Q: How often should we re-screen volunteers?
A: Only 32 percent of volunteer organizations re-screen volunteers on a periodic basis after initial onboarding, creating gaps when a volunteer's circumstances change. Best practice is annual or bi-annual re-screening for high-access roles. For lower-risk roles, re-screening every 3–5 years is reasonable.

Q: Does a clean background check guarantee a volunteer won't commit fraud?
A: No. The typical nonprofit fraud case was committed by a female with no criminal record. A background check prevents onboarding known offenders and liars; it doesn't predict future behavior. That's why strong financial controls, training, and supervision matter just as much as screening.

Q: What's the cost of a background check, and is it worth it?
A: Cost ranges from $5 to $50+ depending on scope and vendor. At VolunteerBadge, FCRA-compliant checks with identity verification cost $5—no recurring fees. Given that nonprofits lose a median of $76,000 per fraud case and only 47% of organizations screen all volunteers, the ROI is clear.

Sources & references

1. PB Mares: 2025 Nonprofit Fraud Risks & Strategies
2. ACFE: The Dark Side of Giving—Charity Fraud Report 2024
3. MJCPA: Nonprofits Don't Lose As Much to Fraud (But Risk Requires Action)
4. The Conversation: Nonprofit Fraud—Amid High-Profile Prosecutions
5. CapinCrouse: What's Your Organization's Fraud Risk?
6. Nonprofit Quarterly: How to Steal from a Nonprofit & How to Prevent It
7. Nonprofit Risk Management Center: A Violation of Trust—Fraud Risk in Nonprofits
8. BoardEffect: Nonprofit Embezzlement Cases to Learn From
9. Nonprofit Law Simplified: Nonprofit Embezzlement—What Action to Take
10. The 415 Group: Nonprofits Should Beware of Internal Fraud
11. Wiley Law: How Nonprofits Can Protect Against Embezzlement and Fraud
12. PFTN Nonprofits: The Embezzlement Epidemic Hiding in Plain Sight
13. For Purpose Law Group: A Timely Warning About Rising Charity Fraud
14. Lee+ Associates: Nonprofit Fraud Hurts More Than the Bottom Line
15. MIP: Fraud in Nonprofit Organizations—Global Study Facts
16. Momentive Software: When to Background Check Volunteers
17. VolunteerBadge: Volunteer Background Check Statistics (2026)
18. VolunteerBadge: Volunteer Background Checks for Nonprofits—The Full Guide
19. Checkr: Background Checks for Nonprofits & Volunteers
20. GoodHire: Background Checks for Nonprofits
21. Sterling Volunteers: Volunteer Background Screening Platform
22. iProspect: Background Checks for Nonprofits (2026 Guide)
23. Background Checks for Volunteers—Nonprofit Screening Services
24. Nonprofit Law Simplified: How to Prevent Embezzlement—Top 10 Tips
25. MJCPA: How to Help Your Nonprofit Recover from Embezzlement Schemes
26. Nonprofit Information: Embezzlement—Signs of Fraud
27. Enterprise Bank & Trust: Five Fraud Vulnerabilities for Nonprofits
28. North Carolina Center for Nonprofits: Global Study Finds Fraud Impacts Nonprofits
29. University of South Carolina: Reducing Fraud in Nonprofit Organizations (2025)
30. Eastern Michigan University: Charity Fraud Met with a Yawn

Sources & methodology

This report draws on the 2024 Occupational Fraud: A Report to the Nations from the Association of Certified Fraud Examiners (ACFE)—the gold standard in fraud data—supplemented by 2024–2026 studies from PB Mares, CapinCrouse, the Nonprofit Risk Management Center, and peer-reviewed research. Where recent data was unavailable, we cited the most recent credible study (e.g., 2020 ACFE) and noted the year. Government data (IRS, Census Bureau, AmeriCorps) adds context on volunteer scale.